RUS | ENG | All
Enter the email or login, that you used for registration.
If you do not remember your password, simply leave this field blank and you will receive a new, along with a link to activate.

Not registered yet?
Welcome!

2015-12-04 21:55:00

CHINA DOUBLES OIL

CHINA DOUBLES OIL

China is likely to double its strategic crude oil purchases next year as one of the biggest ever price routs spurs a buying spree that would offer some support to battered markets for the commodity.

Beijing will add 70-90 million barrels of crude to storage tanks in 2016 to build up its strategic petroleum reserves (SPR), according to most respondents in a poll of five analysts and data collected by Reuters analysts.

That is the equivalent to almost a fortnight's worth of average Chinese imports and would help push the country's overall oil purchases to record levels, challenging the United States as the world's top importer.

Any sign of fresh buying for China's strategic reserves would offer rare support to crude prices , which have more than halved since 2014 on soaring global output that has seen 0.5 to 2 million barrels of oil being churned out every day in excess of demand. The Organization of the Petroleum Exporting Countries (OPEC) meets in Vienna on Friday to discuss its output target.

"Next year, stockpiling is going to play a bigger role (in China) than this year," said Wendy Yong at energy consultancy FGE.

China's secretive SPR build-up, which the government wants to raise to OECD-standards of 90 days' worth of import demand, started in 2006 as part of a drive to become more energy independent. The government's National Development & Reform Commission did not respond to requests for comment on Friday.

Researchers at FGE, consultancy ICIS and bank Barclays estimated that China would double crude imports for SPR facilities to 70-80 million barrels next year, versus 30-40 million barrels in 2015, while other analysts said the volume could be higher still.

"There is still significant spare capacity in China's SPR, which can take in another 12 million tonnes of crude (88 million barrels)," said Yaw Yan Chong, Asia director at Thomson Reuters Oil Research and Forecasts, which he said the government would try to fill provided prices remain relatively low.

He added that this was equivalent to 66 percent of remaining capacity in SPR facilities based on an analysis of China's import trade data.

SPR imports of around 90 million barrels would take the reserve's total to over 300 million barrels, more than halfway towards the government's target of reaching 550 million barrels by 2020.

Energy Aspects said it was possible that 150 million barrels of capacity could be filled in 2016, but said that some of that would likely slip into 2017.

The discrepancy in estimates is partly because some commercial storage is also used for strategic reserves without being reported as such.

UNDER CONSTRUCTION

Six new SPR sites, including some commercial assets being used for the programme, with a total capacity of 146 million barrels are under construction and experts expect most of them to be filled next year.

But some senior Chinese traders were more cautious, arguing that a clampdown on safety after the deadly Tianjin port blast this year could delay new depots, stifling imports.

A trading executive previously involved in reserve purchasing estimated an additional 30 million barrels would be stockpiled for 2016, versus 20-30 million this year. He declined to be identified due to the sensitivity of the matter.

"As China has already built up a comfortable cushion of stocks, the pressure to rush has eased, especially as the government is more convinced that low oil will stay for another year or two," he said.

But analysts expect excess oil production to cushion the impact on global oil markets of the strategic stockpiling.

"The price impact of China's SPR stockpiling is likely to be small," said Barclays analyst Zhang Chi.

"Compared with the estimated excess supply in the market of about 1.5 million bpd, our estimated 0.23 million bpd of crude purchases for the SPR would provide only marginal support for the market balance."

reuters.com

-----

More: 

$15 BLN FOR ROSNEFT 

CHINA BUYS U.S.:$1.3 BLN 

BP & CHINA AGREEMENT: $10 BLN 

BP & CNPC COOPERATION 

U.S. & CHINA WARSHIPS

 

 

Tags: OIL, PRICES
Chronicle:
CHINA DOUBLES OIL
2021, June, 10, 12:39:00
Which Actions Can Fuel The Industry: The 7th International LNG Congress Summary
Global view on the LNG industry future, actions in frames of IMO Regulations, alternative fuels for trucks and fleet, opportunities of LNG increase in Europe, and Bio-LNG and LNG-to-Power initiatives have become some of the topics of the 7th International LNG Congress. It was held at the BGS online platform on the 7-8 of June, and gathered more than 500 decision-makers of the LNG industry.
CHINA DOUBLES OIL
2021, June, 10, 12:38:00
МЕЖДУНАРОДНАЯ КОНФЕРЕНЦИЯ И ВЫСТАВКА "УГОЛЬ РОССИИ И СНГ"
Более 150 руководителей ведущих предприятий угольной промышленности России и СНГ соберет Международная конференция и выставка «Уголь России и СНГ», которая будет проходить 16-17 ноября 2021 в г. Москва Организатор мероприятия: Vostock Capital
CHINA DOUBLES OIL
2021, June, 10, 12:35:00
U.S. OIL INVENTORIES DOWN 5.2 MB TO 474.0 MB
U.S. commercial crude oil inventories decreased by 5.2 million barrels from the previous week to 474.0 million barrels.
CHINA DOUBLES OIL
2021, June, 10, 12:30:00
TC ENERGY HAS TERMINATED KEYSTONE
TC Energy Corporation (TSX, NYSE: TRP) (TC Energy or the Company) confirmed today that after a comprehensive review of its options, and in consultation with its partner, the Government of Alberta, it has terminated the Keystone XL Pipeline Project (the Project).
CHINA DOUBLES OIL
2021, June, 9, 12:55:00
OIL PRICE: ABOVE $72
Brent rose 73 cents, or 1%, to close at $72.22 a barrel, WTI rose 82 cents, or 1.2%, to settle at $70.05 a barrel,
CHINA DOUBLES OIL
2021, June, 9, 12:50:00
OIL PRICES 2021-22: $68-60
EIA forecasts that Brent prices will remain near current levels in 3Q21, averaging $68/b., and $60/b in 2022.
CHINA DOUBLES OIL
2021, June, 9, 12:45:00
OPEC+ OIL PRODUCTION UP 430 TBD
Despite the production gains, the looser quotas meant OPEC+ compliance stayed mostly steady at 111.45% compared to 111.16% in April,
All Publications »